What is the difference between $7,500 & $8,000 tax credits for first time home buyers?

Goldfish
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Jun 25, 2009 by Goldfish
Category: Home Loans

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Sanda Hnatjuk-Bahic
1 Votes
Advisor: Sanda Hnatjuk-Bahic, Real Estate
Jun 25, 2009  
10% of purchase price not to exceed $8,000 is federal home buyer's tax credit and is available January 1, 2009 to November 30, 2009, inclusive.

A repayable $7,500 tax credit was available for purchases from April 9, 2008 to December 31, 2008.

A State of California tax credit of 5% of the sale price, up to $10,000, is now being offered to qualifying people purchasing newly constructed, previously unoccupied homes.
Rada Roberts
0 Votes
Advisor: Rada Roberts, Real Estate
Jun 25, 2009  
Before they passed the bill for the $8000 tax credit they had a $7500 tax credit. The $7500 tax credit is a loan that has to be paid back $500 a year. It is a 0 interest loan. The $8000 tax credit is 10% of the purchase price and a maximum of $8000. It is a total tax credit that you recieve thru your tax returns. You need to check with your accountant but I think you can ammend your tax returns for 08 and get the tax credit now.
Marshall Ghant
1 Votes
Advisor: Marshall Ghant, Real Estate
Jun 25, 2009  
Before they passed the bill for the $8000 tax credit they had a $7500 tax credit. The $7500 tax credit is a loan that has to be paid back $500 a year. It is a 0 interest loan. The $8000 tax credit is 10% of the purchase price and a maximum of $8000. It is a total tax credit that you recieve thru your tax returns. You need to check with your accountant but I think you can ammend your tax returns for 08 and get the tax credit now.
Igor Jekauc
0 Votes
Advisor: Igor Jekauc, Tax Planning
Jun 25, 2009  
$7500 credit was for purchases made in 2008 and the $8000 credit is for purchases made in 2009. Also, the $7500 credit eventually has to be repaid to the government (interest free) where the $8000 credit does not have to be repaid if you use the home as a primary residence for a certain period of time. Congress is actively working on a new credit up to $15,000 which may extend through 2011 and will in all likelihood include all taxpayers and not just first time homebuyers.
Mark Goldman
0 Votes
Advisor: Mark Goldman, Home Loans
Jun 25, 2009  
It depends on the tax year when you bought your home. The $8,000 amount is for homes purchased in 2009. Consult with your tax adviser for special rules.
Vladimir Raicevic, CPA
2 Votes
Advisor: Vladimir Raicevic, CPA, Tax Planning
Jun 25, 2009  
The 7,500 credit was for purchases in 2008 and must be repaid over a period of time starting in 2010 in $500 increments (15 year payback, it really is a interest free government loan). The 8,000 credit is for 2009 and ends on 12/1/09. The credit is not refundible. * Beware both credits have rules if you sell the home before certain holding periods are met. Not all buyers will qualify based on previous ownership periods and income limitations.
Dave Kramer
0 Votes
Advisor: Dave Kramer, Home Loans
Jun 25, 2009  
the new $8000 credit does not need to be paid back. this is available until end of November, I believe.
Kristina Milano
2 Votes
Kristina Milano
Jun 25, 2009  
The Senates $15,000 homebuyer tax credit has been stripped from final version. In it's place is an $8,000 tax credit for first time buyers. Note that this credit does not need to be paid back, unlike the original $7,500. To qualify the purchase has to be made between Jan 1, 2009 and before Nov 30, 2009 and you have to stay in your home for 3yrs. This is a refundable tax credit, and it's phased out for individuals with AGI of 75k or higher or couples with AGI of 150k or higher.
Steven Leibold, EA
3 Votes
Advisor: Steven Leibold, EA, Tax Planning
Jun 25, 2009  
The $7500 credit was for houses bought after 4/18/2008 and before 12/31/2008. That credit amount was only for tax year 2008 and must be paid back over 15 years starting 2010. The $8000 credit is for houses bought 1/1/2009 through 12/1/2009. This $8000 credit does not need to be repaid.
Sally K. Hanson
0 Votes
Advisor: Sally K. Hanson, Real Estate
Jun 25, 2009  
I am unaware of any $7500 buyer credit offered currently.